Multipliers Used In Stimulus Plans

John Taylor’s May 21 blog post discusses the stimulus multiplier used for the ARRA and new research from the IMF with regard to actual stimulus multipliers. The chart shown has immense significance on a variety of fronts, assuming that the IMF research is representative of the effectiveness of stimulus spending. We, as a nation, do …

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Milton Friedman On Monetary And Fiscal Policy

I found this passage from Milton Friedman in 1958, as seen on John B. Taylor’s blog, to be notable, especially given the immense monetary and fiscal policy actions taken to “improve” our economic situation: “The available evidence…casts grave doubt on the possibility of producing any fine adjustments in economic activity by fine adjustments in monetary …

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Impact Of Government Stimulus On GDP

John B. Taylor had a blog post on May 1, 2010 that discussed the impact of government stimulus on GDP.  The post is titled “Latest Data Continue to Show Little Impact of Government Stimulus on GDP.” _____ One of the reasons that I write extensively about interventions, which includes stimulus programs,  is that I believe …

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Keynesian Theory – A Few Comments

Up to this point, I have yet to mention “Keynes” or any derivative thereof.  The reason for this is simple – I don’t believe that the efforts taken to stimulate the economy are reflective of the theories that Keynes espoused.  Instead, they are a type of “bastardized” Keynesian Theory – used by various parties in …

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The Effectiveness Of Stimulus

“One of the biggest economic myths since the Great Depression is that governments can ameliorate or counteract the ebbs and flows of free markets. Government spending has never worked as a trigger for sustained and vibrant economic growth. Ever. Scholarship has demonstrated that the New Deal perpetuated the Depression rather than cured it. On the …

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The Quality Of Deficit Spending

In the Wall Street Journal on Saturday, February 13 there was an editorial titled “High-Speed Spending.”  This discussed the dubious financial dynamics of a long-proposed “high speed” Orlando-to-Tampa rail project. I also heard of a proposal to do a similar project between St. Louis and Chicago. I have lived in the Chicago area for most …

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Unemployment And Stimulus

Here is a Wall Street Journal editorial from Monday: I found it interesting for two reasons.  First, it has a chart that shows the actual Unemployment Rate vs. that forecast in “The Job Impact of the American Recovery and Reinvestment Plan.”  Currently the Unemployment Rate is approximately 2% above the rate forecasted with the stimulus. Second, the editorial …

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“Cash For Clunkers” Revisited

Here is an October 5 Wall Street Journal editorial reviewing the “Cash For Clunkers” stimulus plan: Also, to provide perspective, a chart of Vehicle Sales from the CalculatedRisk blog (10/1 post) at this link: As one can see, the “Cash for Clunkers” seems to have been successful in temporarily causing a surge in auto sales for July and …

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“Stimulus Spending Doesn’t Work” Op-Ed

Here is an October 1 op-ed in The Wall Street Journal titled “Stimulus Spending Doesn’t Work” : Although I don’t concur with some of the statements in this Op-Ed, I do believe that its overall message and conclusions are important.   SPX at 1054.72 as this post is written

“The Stimulus Didn’t Work” article

Below is a link to a September 17 Wall Street Journal op-ed titled “The Stimulus Didn’t Work” : I found the argument presented by the authors to be very interesting and well worth reading. SPX at 1071.78 as this post is written